Project Fi will help Google amass even more data

As Google dives into the Wi-Fi and cellular network services business in the US, some are wondering what the company is up to. Hint: It's all about the data.

As Google dives into the Wi-Fi and cellular network services business in the US, some are wondering just where the company is headed.

Google, known for its dominant search engine and Android operating system, has been stretching boundaries with newer projects like autonomous cars and robotics. Now it's competing with the likes of wireless carriers like Verizon and AT&T in the data and cellular market.

While the latest Google move may look confusing, Project Fi is feeding Google's long-term strategy -- getting more data about its users that it can turn into ad sales and greater revenue.

"I'm not sure they're trying to become a big-time wireless player," said Brian Haven, an analyst with IDC. "But by becoming a wireless service, it allows Google to gain a lot more data from new end points with users. Data is what drives them. Regardless of whether or not they can generate a nice revenue stream, the data will still feed into the other things they do."

Earlier this week, Google announced that it's working with Sprint and T-Mobile to come out with its own wireless network, dubbed Project Fi.

The company is asking would-be customers to sign up online for an invite to what it calls an Early Access Program for the service; Fi will only be available to Nexus 6 smartphone users at the start.

The service is gaining attention not just because it's a new venture but because it's coming in at a low cost -- US$20 a month for talk, text, Wi-Fi tethering and international coverage, with a $10-per-gigabyte fee for cellular data.

This, said independent industry analyst Jeff Kagan, is a strange move for Google, and one that only time will prove out.

"To tell you the truth I don't get it yet," Kagan said. "I was expecting more. I was expecting a big, innovative new-thinking approach that could transform the industry, but that's not what we got. Maybe it will eventually grow into that, but what we got was a disappointment.... Will this work? To me, this is a big question mark."

However, Kagan also noted that this is Google being Google.

The company, which makes most of its money on search and related advertising, is known for trying out various ideas and technologies. Not all of them work out, but Google doesn't seem afraid to try.

For instance, in the past few years, Google has bought at least eight robotics companies, including well-known Boston Dynamics. Google also has been quite publicly working on computerized wearables, Google Glass, while also test driving its own autonomous cars.

None of these ventures is directly tied to search, which is what made Google a household name. But that doesn't mean they don't fit into the company's long-term plans.

"Google's strategic imperative is always to drive usage of Google services and applications," said Bill Menezes, an analyst with Gartner. "Their core business is never going to be cellular service provider. Their core mission is to get more people to click on Google ads, to use Google Docs, to watch YouTube videos. This new service plays in perfectly with that."

Menezes agrees with Haven that Project FI will enable Google to gain insights into consumer behaviors -- and amass more user data.

"The real question is what is going to be behind the curtain when they start issuing invites and we get a look at the Terms and Conditions," said Menezes. "I figure they'll say they get to track our usage. There won't be an opt-out. If you want to use this service, part of the premium you'll be paying is their access to your usage data. That's just speculation. Maybe they'll have to offer an opt-out, but then who reads the Terms and Conditions? Nobody. People won't even know they can opt out."

That means Google will be able to gather even more data on what people are searching for, what apps they're using and where they are going.

"Google has already been getting that information from people out there using mobile data, but the more people using mobile data, they more info they're getting," added Menezes. "It's like you've been farming 40 acres and you're doubling that to 80. With more data, they can target advertising and better sell you products and all the other things Google does to make money."

The same can be said about Google's Project Loon, which envisions using high-altitude balloons to bring Internet connectivity to remote areas.

More online users means more user info to gather.

Menezes, though, said Google's new service also is about capturing more eyeballs for Google advertisers.

Fi is aimed at people who right now use a rather small amount of cellular data every month. If Google can get more people to use their mobile devices even more, it will drive people onto the mobile web where the company's services are so prominent.

Dan Olds, an analyst with The Gabriel Consulting Group, noted that if the new service is successful, Google will have yet another foothold in owning the customer online experience.

"Where is Google heading? Anywhere they want to," he said. "Do all of these lines of business mean that Google could become distracted and lose a step to competitors? People have thought so before, but we certainly haven't seen that happen in the past."

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Latest Videos

More Videos

Are you sure they wont start a platform that the cheese is white, pretty sure that is racist

Hite

New brand name for Coon Cheese revealed

Read more

Real digital transformation requires reshaping the way the business create value for customers. Achieving this requires that organization...

ravi H

10 lessons Telstra has learnt through its T22 transformation

Read more

thanks

Lillian Juliet

How Winedirect has lifted customer recency, frequency and value with a digital overhaul

Read more

Having an effective Point of Sale system implemented in your retail store can streamline the transactions and data management activities....

Sheetal Kamble

​Jurlique’s move to mobile POS set to enhance customer experience

Read more

I too am regularly surprised at how little care a large swathe of consumers take over the sharing and use of their personal data. As a m...

Catherine Stenson

Have customers really changed? - Marketing edge - CMO Australia

Read more

Blog Posts

Brand storytelling lessons from Singapore’s iconic Fullerton hotel

In early 2020, I had the pleasure of staying at the newly opened Fullerton Hotel in Sydney. It was on this trip I first became aware of the Fullerton’s commitment to brand storytelling.

Gabrielle Dolan

Business storytelling leader

You’re doing it wrong: Emotion doesn’t mean emotional

If you’ve been around advertising long enough, you’ve probably seen (or written) a slide which says: “They won’t remember what you say, they’ll remember how you made them feel.” But it’s wrong. Our understanding of how emotion is used in advertising has been ill informed and poorly applied.

Zac Martin

Senior planner, Ogilvy Melbourne

Why does brand execution often kill creativity?

The launch of a new brand, or indeed a rebrand, is a transformation to be greeted with fanfare. So why is it that once the brand has launched, the brand execution phase can also be the moment at which you kill its creativity?

Rich Curtis

CEO, FutureBrand A/NZ

Sign in